TanyaT
25th May 2005, 16:39
From the SU Board
Those members who are private shareholders will have received the Glazer offer document by now. SU has received the Offer Document as nominee and 'legal' owner of all shares in the SU Share Scheme (SUSS) - members who hold shares only through SUSS will not get a separate Offer Document. A copy of the Offer Document :http://www.manutd.is/video/GlazerCircular.pdf.
We have not yet heard from the MU Board, but we expect them now to recommend remaining shareholders to accept the offer, as Glazer has control anyway and it would be reckless financial advice to do otherwise. Our brokers Brewin Dolphin are also advising their private clients to sell.
Please do not panic, or do anything until you formally hear from us - we are in the process of putting together a letter to members as well as a letter to all small shareholders, a time-consuming and complex exercise as you can imagine. We hope to get these letters out this week.
We are always mindful that we have to act responsibly, within the law and in accordance with our Constitution in respect of our members and their shares. But ultimately, it will be your own decision as to what you each do with your shares, with guidance from us on your options.
You should also be aware that the reports in the newspapers about the 3-week deadline for selling to Glazer or risk being left with worthless shares are, as usual, incomplete and inaccurate. This is the definitive legal position.
(1) The initial period for acceptances of the offer does expire at 3.00pm on 13 June, the minimum offer period of 3 weeks allowed by law.
(2) If Glazer gets to 90% acceptances of his Offer, that is shareholders holding a total of 90%+1 of the share capital have agreed to his offer by 13 June, then he is legally bound to extend his offer to all remaining shareholders for at least another 3 months, at the same price of £3.00.
(3) If at any time Glazer gets acceptances from shareholders comprising 97.8% or more of the share capital, he then has the right (but not the obligation) to compulsorily buy out the remaining shares at the same price of £3.00.
(4) Those who accept by 13 June will within 14 days get cheques posted to them for their sale proceeds.
To summarise:
· if Glazer does get past 90% by 13 June, as most experts expect him to do, you/we will get a further min. 3 months to decide what to do.
· if he does not get to 90%, he may choose not to extend the offer to save himself £80+ million of borrowings, and those remaining shares are then locked in and will effectively become financially worthless (no dividend, no liquid market exit etc) with symbolic ‘resistance’ value only. [It looks from the Offer Document that he is hoping not to have to buy everyone out, because this significantly reduces his debt – this should be a significant factor in your decision.]
· on the other hand, if he does not get to 90% there would be 10%+ of shareholders who can potentially be organised for resistance in all the ways we have been looking at (legal challenges etc – we are still reviewing options in this regard).
But to repeat we have to be mindful of people’s different interests as well as their emotions, so we will be trying to be dispassionate and logical about everything we do and say.
As you know, SU is preparing for the establishment of the ‘Phoenix Fund’, a buyback war chest which can be used in future to get our shares back if and when Glazer fails. We cannot give financial advice to members or small shareholders about what to do with their shares or their money if they sell, but we are moving towards saying to members that the Board and the Committee who hold private shares and who have shares in SUSS will be taking Glazer’s money and putting it into the Fund. In accordance with our aims and objectives, this seems to many of us the best way to continue to keep SU together, to give our members a realistic hope and a dream that we will one day get our club back. Remember the history spirit of United - Sir Matt resurrected the club from the ashes of Munich, we can reclaim our club from the ashes of the Glazer takeover. The Phoenix Fund gives us the springboard to do just that, but only if we stay united.
Those members who are private shareholders will have received the Glazer offer document by now. SU has received the Offer Document as nominee and 'legal' owner of all shares in the SU Share Scheme (SUSS) - members who hold shares only through SUSS will not get a separate Offer Document. A copy of the Offer Document :http://www.manutd.is/video/GlazerCircular.pdf.
We have not yet heard from the MU Board, but we expect them now to recommend remaining shareholders to accept the offer, as Glazer has control anyway and it would be reckless financial advice to do otherwise. Our brokers Brewin Dolphin are also advising their private clients to sell.
Please do not panic, or do anything until you formally hear from us - we are in the process of putting together a letter to members as well as a letter to all small shareholders, a time-consuming and complex exercise as you can imagine. We hope to get these letters out this week.
We are always mindful that we have to act responsibly, within the law and in accordance with our Constitution in respect of our members and their shares. But ultimately, it will be your own decision as to what you each do with your shares, with guidance from us on your options.
You should also be aware that the reports in the newspapers about the 3-week deadline for selling to Glazer or risk being left with worthless shares are, as usual, incomplete and inaccurate. This is the definitive legal position.
(1) The initial period for acceptances of the offer does expire at 3.00pm on 13 June, the minimum offer period of 3 weeks allowed by law.
(2) If Glazer gets to 90% acceptances of his Offer, that is shareholders holding a total of 90%+1 of the share capital have agreed to his offer by 13 June, then he is legally bound to extend his offer to all remaining shareholders for at least another 3 months, at the same price of £3.00.
(3) If at any time Glazer gets acceptances from shareholders comprising 97.8% or more of the share capital, he then has the right (but not the obligation) to compulsorily buy out the remaining shares at the same price of £3.00.
(4) Those who accept by 13 June will within 14 days get cheques posted to them for their sale proceeds.
To summarise:
· if Glazer does get past 90% by 13 June, as most experts expect him to do, you/we will get a further min. 3 months to decide what to do.
· if he does not get to 90%, he may choose not to extend the offer to save himself £80+ million of borrowings, and those remaining shares are then locked in and will effectively become financially worthless (no dividend, no liquid market exit etc) with symbolic ‘resistance’ value only. [It looks from the Offer Document that he is hoping not to have to buy everyone out, because this significantly reduces his debt – this should be a significant factor in your decision.]
· on the other hand, if he does not get to 90% there would be 10%+ of shareholders who can potentially be organised for resistance in all the ways we have been looking at (legal challenges etc – we are still reviewing options in this regard).
But to repeat we have to be mindful of people’s different interests as well as their emotions, so we will be trying to be dispassionate and logical about everything we do and say.
As you know, SU is preparing for the establishment of the ‘Phoenix Fund’, a buyback war chest which can be used in future to get our shares back if and when Glazer fails. We cannot give financial advice to members or small shareholders about what to do with their shares or their money if they sell, but we are moving towards saying to members that the Board and the Committee who hold private shares and who have shares in SUSS will be taking Glazer’s money and putting it into the Fund. In accordance with our aims and objectives, this seems to many of us the best way to continue to keep SU together, to give our members a realistic hope and a dream that we will one day get our club back. Remember the history spirit of United - Sir Matt resurrected the club from the ashes of Munich, we can reclaim our club from the ashes of the Glazer takeover. The Phoenix Fund gives us the springboard to do just that, but only if we stay united.